China's HSBC Flash PMI for July is 47.7 -- an 11-month low -- comapred with June's final reading of 48.2, CNBC reports. The employment sub-index was at a 52-month low of 47.3.

The Australian dollar quickly fell to 92.5 cents US on the news. Australia is heavily dependent on commerce with China.

The July PMI marks a third straight month below the watershed 50 line which demarcates expansion of activities from contraction. It was the weakest level since August 2012.

"The lower reading of the July HSBC Flash China Manufacturing PMI suggests a continuous slowdown in manufacturing sectors thanks to weaker new orders and faster destocking," Hongbin Qu, chief China economist of HSBC, told Reuters. "This adds more pressure on the labor market."

A sub-index measuring employment slid to 47.3 in July, the weakest since March 2009, Reuters reported. It stood at 47.6 in June and has been below 50 for four months in a row.

The new orders sub-index fell to its lowest level in 11 months, and stayed below 50 for a third straight month. Output declined to 10-month low and remained in contraction for a second month.

The HSBC/Markit Flash PMI is published about a week before the final reading, and is based on approximately 85-90 percent of total PMI survey responses each month. It is the earliest available indicator of monthly activity in the Chinese economy.

"As Beijing has recently stressed securing the minimum level of growth required to ensure stable employment, the flash PMI reinforces the need to introduce additional fine-tuning measures to stabilize growth," Qu said.

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